The Dow Jones is considered the "Main Street" view of how well the stock market is performing, but is less significant than the broader Standard & Poor's 500, which institutions use as a benchmark.

It's price weighted, which means the higher a company's stock price the more influential it is on the index.

Others indexes such as the S&P 500 are weighted by components' overall market value.

"When you go out to the bar at night, or you go home and you say, 'What did the stock market do today?' the majority of people will go, 'Oh, the Dow was up 50 points, or the Dow jumped 300 points,'" Dan Greenhaus, chief global strategist at New York brokerage BTIG LLC told the Wall Street Journal.

"It's the number that most people, when they think of the stock market, refer to."